D.C. probes Medicaid suppliers

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Four of the top 10 companies in the $11.4 million business last year of providing power scooters, wheelchairs, prosthetic limbs and other medical equipment to D.C. Medicaid recipients have come under investigation.

At least six other “durable medical equipment,” or DME, dealers also are being investigated, including one suspected of selling a recipient a walker, then billing the government for a $13,500 deluxe power scooter.

The D.C. Department of Health confirmed the investigations in response to a Freedom of Information Act request by The Washington Times.

Agency attorneys withheld several records, saying the documents are “investigatory records compiled for law enforcement,” therefore exempt from public disclosure. Officials also would not release the names of the companies under investigation.

The situation raises questions about whether fraud and mismanagement, which have plagued the District’s Medicaid transportation program in recent years, also have surfaced in the DME program.

The Medical Assistance Administration (MAA), an arm of the health department, oversees the city’s more than $1 billion in Medicaid spending, which is funded by federal and local governments to provide health care for the poor.

Nearly 90 DME companies, mostly in the District and Maryland, received a combined $11.4 million in fiscal 2006 to supply the city’s poor.

The figure is up from $10.1 million in 2005 and $9.8 million in 2004. And while officials say overall costs remain within budget, MAA spending could increase by 40 percent compared to 2004 figures. Already, MAA had paid out more than $12 million in fiscal 2007.

Records reviewed by The Times show DME companies alone accounted for nearly half all of the medical-equipment costs incurred by the city’s Medicaid program in 2006.

Billing patterns vary widely. One company received $1.5 million after submitting 11,644 Medicaid claims while another received $1.5 million on only 426 claims.

A health department spokeswoman said MAA is “pro-active in reviewing and auditing DME claims.”

“We cannot comment on particular efforts but can say that if we become aware of improper billing practices in a given area, we would devote appropriate effort to reviewing other providers from that area of concern,” said spokeswoman Leila Abrar.

A recent internal MAA e-mail obtained by The Times shows that at one point, many Medicaid agreements between providers and the District were activated without a D.C. Medicaid official signing off on the documents.

In an internal memo, MAA’s former acting manager, William Brown, stated in January that D.C. Medical officials had just recently learned that five years earlier a former program manager “did not sign several provider agreements.”

As a result, the city’s Medicaid contractor, Affiliated Computer Services, “activated hundreds (maybe thousands) of provider agreements … that do not have a signature from an MAA official during the re-enrollment period in 2002,” Mr. Brown wrote. He blamed former city Medicaid officials.

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